Arthaland's P3-B green bonds maintain high rating

Published April 8, 2022, 1:58 PM

by James A. Loyola

Arthaland Corporation, the property development arm of the Po family, has maintained the Issue Credit Rating of PRS Aa, with a Stable Outlook for its P3-billion Fixed-rate ASEAN Green Bonds.

In a disclosure to the Philippine Stock Exchange, the firm said this is the initial issuance in relation to its 3-year Shelf Registration of up to P6 billion.

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ASEAN Green Bonds adhere to the ASEAN Green Bonds Standards which require proceeds to be used exclusively to fund eligible green projects, including certified green buildings.

A regular review on the use of proceeds and quantifiable updates on the funded project’s environmental benefits are also required.

Philippine Rating Services Corporation (PhilRatings) said obligations rated PRS Aa are of high quality and are subject to very low credit risk. The obligor’s capacity to meet its financial commitment on the obligation is very strong.

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On the other hand, a Stable Outlook is assigned when a rating is likely to be maintained or to remain unchanged in the next 12 months.

PhilRatings said its rating and outlook for the issue were assigned given Arthaland’s clear strategic direction, resulting in global recognition as a real estate developer of multi-certified (locally and internationally) green projects in the Philippines, leading to continued market interest in its products.

It also noted that the firm has been able to sustainably grow and compete in its chosen niche, despite the presence of larger competitors with a more established presence and longer operating history.

Also factored in the rating is Arthaland’s relatively manageable liquidity position in relation to debt servicing and its improved profitability supported by less stringent economic restrictions.

PhilRatings also considered the economic recession and weaker market conditions that have tempered the industry’s growth momentum, albeit the sector is showing signs of recovery and points towards a more positive outlook.

Arthaland is a recognized sustainable developer of premium residential and commercial properties. All of the Company’s projects are multi-certified by both local and global organizations in terms of environmental sustainability.

These certifications include: the Philippine Green Building Council’s (PHILGBC) Building for Ecologically Responsive Design Excellence (BERDE), U.S. Green Building Council’s (USGBC) Leadership in Energy and Environmental Design (LEED), International Finance Corporation’s (IFC) Excellence in Design for Greater Efficiencies (EDGE), and the International WELL Building Institute’s (IWBI) WELL Building Standard (WELL).

In 2020, ALCO also participated in the pilot program of PHILGBC – Advancing Net Zero Philippines (ANZ/PH) Program. ALCO is the only real estate developer in the country that has a portfolio which is composed entirely of certified sustainable projects.

 
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